Trackers bale out of Footsie casualties

Market Report

THE SEEMINGLY remorseless slide goes on. Footsie crashed 101.7 points to 4,648.7, its lowest since June last year.

Banks, despite a modest Barclays rally, remained under pressure and some of the recently high-flying telecoms shares were again earthbound.

Such is the state of the market that there is already a tendency for some tracker funds to try and position themselves for the next Footsie review, not due until December.

WPP, the advertising group, is a classic example of anticipating the Footsie judgement. The shares have, like so many others, been completely demoralised but their discomfort has intensified in recent days as Footsie considerations have mingled with the obvious vulnerability of the advertising industry in a possible recession.

The shares had the dubious distinction of leading the latest retreat, falling 36.5p to 202p against a 1998 high of 476p. On present form WPP is a Footsie casualty; its valuation has fallen below pounds 1.8bn.

The trackers are already taking evasive action by selling the shares. They are adopting a similar approach to other Footsie shares in the danger zone such as fund manager Amvescap, down 27p at 263p, and Sema, off 34p to 376p.

As WPP and the others weaken the pressure becomes more intense as the action of the tracker funds make relegation an (almost) self-fulfilling development.

The mid cap index is another area of anxiety. On Friday Business Post, down 22.5p to 252.5p, and engineer Laird, up 13p to 158p, were thrown out to accommodate the two Hillsdown spin offs. Hillsdown, at 100p, and offspring Terranova, 140p, and Fairview Homes, 102.5p, collectively produced a modest but commendable gain.

Footsie's latest fall was achieved against another somewhat unexpected slump in New York and yet further Tokyo weakness. Soothing words after the G7 meeting had no impact and even a UK interest-rate cut on Thursday may be ignored unless it is significant - say, 0.75 percentage points.

Barclays ended its headlong plunge, although a 29p rally to 867p was far from convincing as it denied that it intended to sell Barclays Capital, its investment banking albatross.

British Energy, up 11p to 576p, enjoyed investment house Merrill Lynch support following what was seen as an upbeat output statement. National Power improved 10.5p to 567p after selling some exploration assets to little Dana Petroleum; NP has lifted its Dana stake to 8.56 per cent and picked up pounds 9.4m.

Talk of corporate action creating mega-utilities was also in the air, helping NP as well as PowerGen, up 12.5p to 886.5p. A weaker pound comforted exporters, with British Aerospace up 20p to 332p, and General Electric Co 17.5p to 417.5p.

Marks & Spencer fell 21p to 437p as BT Alex.Brown, worried about a possible sharp deterioration in trading in the past month, slashed its profits forecast by 3 per cent to pounds 1.025bn. For next year the cut is 10 per cent to pounds 1.13bn.

Railtrack, which has for long blissfully ignored the screeching market brakes, was for once shunted into reverse, falling 59p to 1,575p. The company, at a 1,713p peak last week, met analysts last night. It has fixed up a deal with British Land, down 20p at 523p, to develop more land at Railtrack's Broadgate site in the City. Merrill downgraded its BL stance, citing a deterioration in the outlook for City office demand while financial markets are volatile.

Zeneca, down 107p to 1,873p, was hit by Merrill selling. Computers remained in the doghouse; besides Sema, Admiral plunged 210p to 872.5p and CMG 169p to 1,241p.

The cut-price Inchcape sale of its Russian Coca-Cola operation killed off what sparkle was left at Coca-Cola Beverages, sending the shares down 11p to 106.5p; Inchcape dropped 6p to 105.5p.

Danka Business Systems, with another dismal trading statement, crashed 36.5p to 44p; last year the price was 712p. Engineer Headway reported a profits gain, but with bid talks ended the shares fell 10.5p to 39p.

Calluna, the computer security group, fell 1.5p to 14p despite Williams de Broe support and Weir, the engineer, gained a further 6.5p to 187.5p, seemingly on a pounds 14m pump development.

Waverley Mining held at 9.5p. Corporate Resolve, an Ofex traded company, is bidding for 26 per cent but other possible bidders are said to be on the sidelines.

Former chief executive Willie McLucas is one; an Australian miner is also thought to have expressed interest. There are also suggestions that Anglesey Mining, unchanged at 6.75p, might attempt a share exchange offer.

Nord Anglia, an educational group, slumped 30p to 213p as ABN Amro cut its estimate. It is thought to have been reduced from pounds 5.7m to pounds 3.8m.

SEAQ VOLUME: 835.8 million


GILTS INDEX: 115.46 -0.52

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Life and Style
love + sex
Arts and Entertainment
Victoria Wood, Kayvan Novak, Alexa Chung, Chris Moyles
tvReview: No soggy bottoms, but plenty of other baking disasters on The Great Comic Relief Bake Off
Ashley Young celebrates the winner for Manchester United against Newcastle
footballNewcastle 0 Man United 1: Last minute strike seals precious victory
Life and Style
Tikka Masala has been overtaken by Jalfrezi as the nation's most popular curry
food + drink
Arts and Entertainment
Seth Rogan is one of America’s most famous pot smokers
filmAmy Pascal resigned after her personal emails were leaked following a cyber-attack sparked by the actor's film The Interview
Benjamin Netanyahu and his cartoon bomb – the Israeli PM shows his ‘evidence’
ebooksA special investigation by Andy McSmith
Arts and Entertainment
80s trailblazer: comedian Tracey Ullman
Life and Style
A statue of the Flemish geographer Gerard Kremer, Geradus Mercator (1512 - 1594) which was unveiled at the Geographical Congree at Anvers. He was the first person to use the word atlas to describe a book of maps.
techThe 16th century cartographer created the atlas
Arts and Entertainment
Stephen Tompkinson is back as DCI Banks
tvReview: Episode one of the new series played it safe, but at least this drama has a winning formula
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Graduate Application Support Analyst

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Reach Volunteering: External Finance Trustee Needed!

Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...

Christine McCleave: FP&A Analyst

£36,000 - £40,000: Christine McCleave: Are you looking for a new opportunity a...

Recruitment Genius: Sales Executive - OTE £40,000

£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...

Day In a Page

War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

Baghdad fights to win back Tikrit from Isis – but then what?

Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable
Living with Alzheimer's: What is it really like to be diagnosed with early-onset dementia?

What is it like to live with Alzheimer's?

Depicting early-onset Alzheimer's, the film 'Still Alice' had a profound effect on Joy Watson, who lives with the illness. She tells Kate Hilpern how she's coped with the diagnosis
The Internet of Things: Meet the British salesman who gave real-world items a virtual life

Setting in motion the Internet of Things

British salesman Kevin Ashton gave real-world items a virtual life
Election 2015: Latest polling reveals Tories and Labour on course to win the same number of seats - with the SNP holding the balance of power

Election 2015: A dead heat between Mr Bean and Dick Dastardly!

Lord Ashcroft reveals latest polling – and which character voters associate with each leader
Audiences queue up for 'true stories told live' as cult competition The Moth goes global

Cult competition The Moth goes global

The non-profit 'slam storytelling' competition was founded in 1997 by the novelist George Dawes Green and has seen Malcolm Gladwell, Salman Rushdie and Molly Ringwald all take their turn at the mic
Pakistani women come out fighting: A hard-hitting play focuses on female Muslim boxers

Pakistani women come out fighting

Hard-hitting new play 'No Guts, No Heart, No Glory' focuses on female Muslim boxers
Leonora Carrington transcended her stolid background to become an avant garde star

Surreal deal: Leonora Carrington

The artist transcended her stolid background to become an avant garde star
LGBT History Month: Pupils discuss topics from Sappho to same-sex marriage

Education: LGBT History Month

Pupils have been discussing topics from Sappho to same-sex marriage
11 best gel eyeliners

Go bold this season: 11 best gel eyeliners

Use an ink pot eyeliner to go bold on the eyes with this season's feline flicked winged liner
Cricket World Cup 2015: Tournament runs riot to make the event more hit than miss...

Cricket World Cup runs riot to make the event more hit than miss...

The tournament has reached its halfway mark and scores of 300 and amazing catches abound. One thing never changes, though – everyone loves beating England
Katarina Johnson-Thompson: Heptathlete ready to jump at first major title

Katarina Johnson-Thompson: Ready to jump at first major title

After her 2014 was ruined by injury, 21-year-old Briton is leading pentathlete going into this week’s European Indoors. Now she intends to turn form into gold
Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot